Tax problem 1 use Form 1040 year 2020, schedule 1 and schedule E form Please complete the 2020 federal income tax return for Sarah Woods Be sure to include only required tax forms when completing the tax return For purposes of this assignment, unless instructed otherwise, you do not need to attach 8582 Also, ignore the requirement to attach the form W 2 to the front page of the Form 1040 If required information is missing, use reasonable assumptions to fill in the gaps Sarah woods and her now ex husband Kevin were legally divorced on March 1, 2017 As of the end of the year, Sarah was unmarried Sarah and Kevin had only one child, an 11 year old girl named Elizabeth As part of the divorce decree Sarah was given custody of Elizabeth Kevin was required to pay 1) child support for Elizabeths care and 2) alimony to Sarah until she remarries or dies Because Kevin will be making child support payments, the divorce decree provided that Kevin will be permitted to claim the tax dependency exemption for Elizabeth until Elizabeth no longer qualifies as a tax dependent of either parent and the decree obligates Sarah to sign and or file any required forms to cause this result to occur Sarah rents a house (separate from Kevin) that she pays for herself Elizabeth lives with Sarah most of the time, but she visits and stays with her father every other weekend and most holidays During the year, Elizabeth stayed at Kevins house a total of 74 nights Sarah provided the following information for 2020 Sarahs Social Security number is 123 45 4321 Her DOB is 4 15 85 Elizabeths Social Security number is 123 34 1234 Her DOB is 10 12 09 Sarahs mailing address is 1245 Rose Petal Drive, Middletown, WI 53562 Elizabeth is a US citizen The following was reported on Sarahs Form W2 Employer Gross Wages Federal Income Tax Withholding State Income Tax Withholding Central Wisconsin Heating and Air $40,150 $7,250 $2,025 All Applicable and appropriate payroll taxes were withheld by the employer During the year, Sarah also received the following Child Support Payments from Kevin Wood $12,000 Alimony Payment from Kevin Wood $16,000 Gift from her father to help with legal bills $ 8,500 Interest Income on U S Treasury Bond $ 400 Interest Income on Madison City Bond (municipal bond) $ 250 Interest Income from First bank of Madison $ 205 Life Insurance proceeds on the death of her mother $45,000 Sarah is a 50 owner in a friends company, Bright Day Flowers, Inc Bright Day Flowers, Inc (BDF) is a Subchapter S corporation The company reported ordinary business income for the year of $24,000 Sarah acquired the stock several years ago Sarah worked a total of 600 hours at the BDF shop in the evenings and on the weekends during 2020 Bright Day Flowers Inc s Employer Identification number is 56 3535353 Consider the income to be non passive Sarah entered a contest sponsored by a radio station and won 10 tickets to the touring Broadway style production of Hamilton The value of the tickets was $200 each Sarah took her friends from work to the production Sarah lost her job with Central Wisconsin Heating and Air on November 15 because of a reduction in work force She collected $1,750 in unemployment benefits during the year She is currently looking for another job Sarah had qualifying minimum health insurance coverage provided to her because of her employment with Central Wisconsin Heating and Air for each month in 2020 (the employer continued to cover her through the end of the year) Elizabeth had qualifying minimum health insurance coverage provided through Kevin through his work Sarah did not own, control or manage any foreign bank accounts nor was she a grantor or beneficiary of a foreign trust during the year Sarah was provided with the following benefits as part of her employment Group term life insurance coverage of $50,000 The cost to cover Sarah for the company for the tax year is $150 Access to the company photocopy machine Sarah estimates she made $14 worth of copies during the year primarily for use with her church group activities Sarah reported no itemized deductions other than any described above Sarah does not want to contribute to the Presidential Election Campaign Fund She would like to receive a refund (if any) of any tax she may have overpaid for the year Her preferred method of receiving the refund is by check

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Tax problem 1 use Form 1040 year 2020, schedule 1 and schedule E form. Please complete the 2020 federal income tax return for Sarah Woods.

Tax problem 1

use Form 1040 year 2020, schedule 1 and schedule E form. Please complete the 2020 federal income tax return for Sarah Woods. Be sure to include only required tax forms when completing the tax return. For purposes of this assignment, unless instructed otherwise, you do not need to attach 8582. Also, ignore the requirement to attach the form W-2 to the front page of the Form 1040. If required information is missing, use reasonable assumptions to fill in the gaps.

Sarah woods and her now ex-husband Kevin were legally divorced on March 1, 2017. As of the end of the year, Sarah was unmarried. Sarah and Kevin had only one child, an 11-year old girl named Elizabeth. As part of the divorce decree Sarah was given custody of Elizabeth. Kevin was required to pay 1) child support for Elizabeths care and 2) alimony to Sarah until she remarries or dies. Because Kevin will be making child support payments, the divorce decree provided that Kevin will be permitted to claim the tax dependency exemption for Elizabeth until Elizabeth no longer qualifies as a tax dependent of either parent and the decree obligates Sarah to sign and/or file any required forms to cause this result to occur

Sarah rents a house (separate from Kevin) that she pays for herself. Elizabeth lives with Sarah most of the time, but she visits and stays with her father every other weekend and most holidays. During the year, Elizabeth stayed at Kevins house a total of 74 nights.

Sarah provided the following information for 2020:

Sarahs Social Security number is 123-45-4321. Her DOB is 4/15/85
Elizabeths Social Security number is 123-34-1234. Her DOB is 10/12/09
Sarahs mailing address is 1245 Rose Petal Drive, Middletown, WI 53562
Elizabeth is a US citizen

The following was reported on Sarahs Form W2:

Employer	Gross Wages	Federal Income Tax Withholding	State Income Tax Withholding
Central Wisconsin Heating and Air	$40,150	$7,250	$2,025

All Applicable and appropriate payroll taxes were withheld by the employer.

During the year, Sarah also received the following:

Child Support Payments from Kevin Wood	$12,000
Alimony Payment from Kevin Wood	$16,000
Gift from her father to help with legal bills	$ 8,500
Interest Income on U S Treasury Bond	$ 400
Interest Income on Madison City Bond (municipal bond)	$ 250
Interest Income from First bank of Madison	$ 205
Life Insurance proceeds on the death of her mother	$45,000

Sarah is a 50% owner in a friends company, Bright Day Flowers, Inc. Bright Day Flowers, Inc. (BDF) is a Subchapter S corporation. The company reported ordinary business income for the year of $24,000. Sarah acquired the stock several years ago. Sarah worked a total of 600 hours at the BDF shop in the evenings and on the weekends during 2020. Bright Day Flowers Inc.s Employer Identification number is 56-3535353. Consider the income to be non-passive.

Sarah entered a contest sponsored by a radio station and won 10 tickets to the touring Broadway-style production of Hamilton. The value of the tickets was $200 each. Sarah took her friends from work to the production.

Sarah lost her job with Central Wisconsin Heating and Air on November 15 because of a reduction in work force. She collected $1,750 in unemployment benefits during the year. She is currently looking for another job.

Sarah had qualifying minimum health insurance coverage provided to her because of her employment with Central Wisconsin Heating and Air for each month in 2020 (the employer continued to cover her through the end of the year). Elizabeth had qualifying minimum health insurance coverage provided through Kevin through his work.

Sarah did not own, control or manage any foreign bank accounts nor was she a grantor or beneficiary of a foreign trust during the year.

Sarah was provided with the following benefits as part of her employment:

Group-term life insurance coverage of $50,000. The cost to cover Sarah for the company for the tax year is $150.
Access to the company photocopy machine. Sarah estimates she made $14 worth of copies during the year primarily for use with her church group activities.

Sarah reported no itemized deductions other than any described above.

Sarah does not want to contribute to the Presidential Election Campaign Fund. She would like to receive a refund (if any) of any tax she may have overpaid for the year. Her preferred method of receiving the refund is by check.